A Real-Life Analysis Of The New Wage Deduction Rules In New York: What The Legislature Giveth, The Regulators Have Taketh Away

Last week, the New York State Department of Labor issued regulations to implement the 2012 amendments to New York’s wage deduction law. The amendments were enacted to facilitate employer deductions of overpayments and advances from workers’ paychecks. Although the amendments were welcome news for employers last year, few companies are likely to regard these new accompanying regulations as easing the burdens associated with making reasonable deductions from wages in New York.

Section 193 of the New York Labor Law governs wage deductions for inadvertent overpayments and for the repayments of salary or wage advances. The new amendments reversed what the Legislature regarded as overly restrictive interpretations of Section 193 that had been previously enunciated by the New York State Department of Labor (NY-DOL). Essentially, the NY-DOL had regarded as unlawful almost any type of wage deduction not explicitly allowed by statute.

On October 9, 2013, the NY-DOL issued anticipated regulations setting forth rules for employers that wish to make deductions under the law. Legal commentators have tried to describe to employers how to comply with the new rules – but a close look at the DOL’s regulations will likely discourage most businesses from giving advances or recovering overpayments to employees using wage deductions.

The new regulations are exhaustive. They consist of 13 new regulatory sections covering nine densely packed pages of procedural requirements that may prove costly to implement and maintain, especially for smaller companies. For example, the regulations require employers to create and provide specific notices, issue responses, and obtain specific authorizations within certain time periods. They also impose significant limits on the timing, frequency, and amount of deductions and obligate employers to create new dispute resolution policies and procedures in a specific manner. Any deviation, even if minor or inadvertent, from these regulatory mandates may render an otherwise valid deduction unlawful.

Employers who wish to make wage or salary deductions outside of those expressly permitted by statute (such as taxes, garnishments, insurance, etc.) should, at a minimum, revise their handbooks to comply with the final regulations. This revision should include updating the list of permissible deductions and creating new procedures setting forth deadlines for notices and establishing the necessary dispute mechanisms. After advising employees of the new policy, employers should implement the new policy with precision to guard against errors, no matter how insignificant.

But even intrepid employers may want to think twice about committing the resources and time to put into place the apparatus required to comply with the new regulations. Why? Because the new deductions law contains a “sunset” provision that automatically repeals last year’s Section 193 amendments (and these new regulations) on November 2015, unless the law is extended by further legislative action.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

- hide

Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.